Concerns Loom Over EU-U.S. Trade Deal: Potential Amendments Ahead
FRANKFURT, Germany (AP) — The trade committee chairman of the European Parliament, Bernd Lange, expressed skepticism on Wednesday regarding aspects of the new trade deal reached with the Trump administration. Anticipating amendments during the legislative approval process, Lange voiced concerns about the agreement’s implications.
Questions Surrounding Tariffs and Stability
“A lot of questions are there, and I guess there will be some amendments,” Lange stated, revealing doubts shared by several of his colleagues. Although he refrained from outright opposing the deal, he highlighted that its provisions may require further scrutiny.
The agreement, finalized on July 27, outlines a 15% tariff on European goods while eliminating EU tariffs on U.S. cars and industrial products. Notably, certain EU products, such as aircraft, cork, and generic pharmaceuticals, are exempt from the 15% tariff.
Mixed Receptions Among European Business Leaders
Reactions to the deal have been varied within Europe. Business associations warn that the imposed tariffs could lead to elevated costs and hinder exports to the United States. Meanwhile, Ursula von der Leyen, head of the European Commission, argues that the deal will lower the existing 27.5% tariff on automobiles, fostering greater stability for businesses.
Trade Stability in Question
However, Lange remains skeptical, emphasizing a lack of “security or predictability.” He pointed to a recent U.S. decision, made just two weeks after the deal was struck, to impose a 50% tariff on roughly 400 goods containing steel, thereby complicating matters for European exporters.
Support for the Deal Amidst Opposition
Despite the doubts, Sabine Weyand, the EU’s director general for trade, urged the committee to approve the deal, asserting that the tariff rate is low enough to maintain trade flow and prevent a potentially worse trade conflict. “You need to look at the alternative,” she noted.
Legal Challenges and Future Implications
The agreement is currently documented only in a brief joint statement, which leaves open the possibility for further negotiations on critical issues. Meanwhile, questions persist regarding Trump’s legal authority under a 1977 law to impose such expansive tariffs. A recent U.S. appeals court ruling aligns with this concern, stating the president may lack the power to enact tariffs of this scale without congressional approval.
Growing Tensions Over Additional Tariffs
Trump’s recent threats concerning potential tariffs in response to EU digital regulations have further fueled tensions, with some EU officials maintaining such issues are outside the scope of the current trade deal. “Where will it end? We are just getting more and more demands from Trump,” questioned Saskia Bricmont, a deputy from the Greens/European Free Alliance group.
Parliamentary Actions Required for Implementation
For the EU side of the tariff agreement to be enacted, parliamentary approval will be necessary. While Lange did not specify potential amendments, it is evident that dissent exists within the ranks. The center-left Socialists and Democrats group, which holds only 136 seats in the 720-seat parliament, has already voiced opposition but cannot single-handedly block the deal.
Broader Trade Strategies: Mercosur Deal on the Horizon
In addition to the U.S. agreement, the European Commission is determined to enhance trade relationships with other global partners. This includes advancing free trade agreements with Mexico and the Mercosur trading bloc in Latin America. The Mercosur deal aims to establish the world’s largest free trade zone, encompassing 700 million people, while also alleviating high tariffs on EU agricultural exports to Latin American markets.
To address concerns from EU farmers, particularly in France and Poland, the agreement allows a limited amount of Mercosur beef to enter the European market at a moderate 7.5% tariff, with protections in place for surplus exports. Additionally, a support fund of €6.3 billion is set aside for farmers facing unexpected market disruptions.
As discussions continue, the future of the EU-U.S. trade deal and additional international agreements remain imperative for both economic stability and cooperative relations moving forward.
